You know you should: Make a will

It’s a parent’s worst nightmare – to die and leave their young children all alone in a big, bad world. And it is the fear of that horrid thought that leaves many parents powerless to do the very thing that would help their children the most – to make a plan that will determine who will care for the kids and how and when they will get family assets.

Estate planning attorneys say parents are often lax about drawing up a will and putting specific wishes down on paper because the thought of preceding their young children in death terrifies them. That and the fact that most parents honestly don’t believe they have much to leave their kids.

While you’re pondering who you would choose to raise your kids in your absence, let’s talk about the easy stuff: the money.

“People don’t think they have that much. I hear that all the time,” said Deborah Plaks Hochman, a Miami estate planning attorney and mom of three grown children. “But when you look at the value of property and life insurance and other assets, it starts to add up. Florida recognizes that a child is an adult at 18. Do you really want a million dollars going to an 18-year-old?”

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Without an estate-planning tool such as trust, everything could end up in the hands of the courts, she said, and every time your child needs money, the courts will have to approve it.

“Then who do you think will get the bulk of the money? The courts and the attorneys,” Hochman said. “You worked hard for your money. You want it to go to your children.”

Here's a quick guide to what you need to do now:

MAKE A WILL

A will designates how you want your assets distributed at the time of your death, who you want to take care of your kids until they are 18, and when and how you want assets given to your kids.

You will specify a personal representative to handle your financial affairs, gather your assets, pay off your debts and distribute what’s left to your beneficiaries. When you pick a personal representative, choose someone “who is responsible and who knows your children,” Hochman advises. It’s also smart to choose a back-up person in case your first choice is unable to fulfill the duties, she said.

CHOOSE A GUARDIAN

When you are choosing the person who will raise your kids in your absence, there are many factors to ponder:

Do they share the same morals and lifestyle as you?

Are they financially stable?

Consider their age. Many people name their own parents as guardians, but will an aging grandparent be equipped to deal with a teenager?

Carefully consider the options, and make sure the guardian you name is willing to take on the task. But name someone, because if you don’t, the state will.

If you have complicating factors such as children from previous and current marriages, then have a family meeting to sort things out now, Hochman advises.

DECIDE WHEN KIDS GET ASSETS

Your personal representative will distribute assets to your beneficiaries. If the recipients are adults, the assets will go to them directly. If the recipients are your minor children, they will go to the guardian, who will manage the assets.

“In Florida, this is monitored by the courts, and the guardian will have to report to the court every single year until the kids are 18 … This annual accounting has to show where every penny goes,” said David Shulman, an estate planning attorney in Fort Lauderdale. If you have assets of several hundred thousands dollars or more, setting up an estate planning tool such as a trust can help you distribute money to your kids at various stages, rather than having them receive everything at age 18. “Most 18-year-olds are not mature enough to handle a lot of money,” he said.

GET PROFESSIONAL ADVICE

Do-it-yourself will kits can be had on the Internet and in office supply stores, but estate planning attorneys say the money you save now may cost you in the future. Many kits are written in general language without regard to state laws, which vary. And many people who buy kits don’t properly execute them in the eyes of the law.

FIND AN ATTORNEY YOU TRUST

Many estate planning attorneys offer free initial consultations. Ask friends and relatives for recommendations. In South Florida, fees range from $750 to $1,500 for a basic estate plan, which includes a will for each spouse and reviewing the estate to help you figure out what’s best for you and your family.

Estate plans typically include documents such as a living will, which expresses wishes regarding your health if you are medically incapacitated, and a power of attorney to handle financial affairs if you cannot handle them yourself.

Hochman said the investment will likely save money in the future. “This is about a fourth of what you would pay if you did nothing, and looked at legal fees afterward,” Hochman said.

GET OVER YOUR FEAR AND ACT

“I think one of the greatest hurdles is that people don’t want to think about their own death, about their mortality and about leaving their kids behind,” Shulman said. “The second hurdle is that people don’t want to pay. And the last hurdle is that people procrastinate. It’s like painting the garage, cleaning out the attic, making a will. It’s things people never get to.”

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